probate information

probate information

Our views as to will making

	We believe that a Will is an extremely important document no matter how large or small a persons estate is likely to be.
	Whilst in theory any Solicitor or Will Writer can produce a Will, we consider that it is essential for a client to receive advice from a solicitor who is able to give specialist advice so as to ensure that not only is the will legally effective but also that sufficient thought is given to potential beneficiaries and Tax considerations
	As local family solicitors with wide experience of Will making we are ideally placed to give this advice to our clients.

Who should make a will

If a person dies without having made a will his or her estate falls to be administered according to the rules set our in the Administration of Estates Act . For most people this does not provide a satisfactory outcome. For example:

	If there is a surviving spouse and children the spouse will only receive £125,000 and personal chattels plus a life interest in half the rest with the balance going to the children.
	If there is a surviving spouse and no children the spouse will only receive £200,000 and personal chattels plus a life interest in half the rest with the balance going to parents or brothers and sisters if parents are both dead.
	In situations where there is no person legally entitled to the estate it will pass to the Crown.
	Without a will there is no opportunity to make special gifts to other close relatives friends or charities.
	In the case of unmarried couples, a partner will not inherit unless a Will is made
	In the case of a second marriage, a surviving spouse may inherit monies that should properly go to the children of the person dying
	If you make a will you can decide who you wish to appoint as Executors to carry out your wishes.
	Without a will there is no chance to arrange your affairs so as to minimise the burden of Inheritance Tax

Home made wills

It is generally not a good idea to try to make your own will. Wills have to be made and executed strictly in accordance with the provisions of the Wills Act and it is easy for a lay person to get something wrong. Perhaps more importantly, your Solicitor can advise you as to ways of dealing with your estate that you might not have thought of, or can point out potential pitfalls and can also suggest ways in which you might be able to reduce the potential liability to Inheritance Tax. Straight forward wills can cost as little as £95 for a single will or £150 for "mirror wills".

What are Executors and Administrators?

	Executors are the persons that you appoint in your will to attend to the winding up of your estate following your death
	Administrators carry out similar tasks in cases where there is no will, or where for some reason the Executors named in a will are unable or unwilling to apply for probate

Who should I choose as my Executors?

	In the case of "Mirror Wills" (where a couple provide for everything to pass to the survivor of them and then to other beneficiaries eg. children) consider appointing your husband/wife/partner as sole executor if he or she survives, with other executors being appointed to act on the second death.
	In other cases it is usually a good idea to appoint two executors. This ensures that there will be an executor remaining if one is unable to act.
	For obvious reasons it is advisable to appoint persons younger than yourself to be your executors.
	Family members may be executors, even if they are beneficiaries named in the will. However, neither beneficiaries nor their spouses should ever act as witnesses to a will.
	You can appoint one of our solicitors to be one of your executors. This is sometimes a good plan where you are not sure who to appoint, or where you feel that there are likely to be some difficult decisions to be made following your death. We make no charge for acting as executor. We only charge for work done in relation to the winding up of the estate in the usual way.
	Banks can be appointed but be careful! The charges levied by the Banks are normally based on a straight percentage of the estate and can significantly increase the costs of winding up the estate.

Probate and Letters of Administration

	Probate is the document issued by the Government Probate Registry following death to give legal recognition to the will and to the appointment of the executors.
	Letters of Administration is the document issued by the Probate Registry following death in cases where there is no will, or where for some reason the Executors named in the will are unable or unwilling to apply for probate. The persons appointed as Administrators are usually the next of kin of the deceased person.
	A grant of Probate or Administration is required to deal with freehold or leasehold property or to release other substantial assets held in the name of the deceased person
	In some cases it may not be necessary to apply for a grant of Probate or Administration. We will always advise you as to the quickest and easiest way of sorting out the affairs of someone who has died.

Inheritance Tax (as from November 2007)

The standard rate of Inheritance Tax is 40% of the taxable estate passing on death. This includes certain lifetime gifts. The basic exemptions and reliefs are as follows:

	All property passing to a surviving spouse or civil partner is tax free
	The first £300,000 of the estate is tax free (this is known as "the Nil Band")
	Property left to Charity is tax free
	Certain reliefs exist for business assets and agricultural property
	Gifts made more than seven years prior to death, and gifts not exceeding £3,000 in any year are normally exempt and Taper Relief may apply for gifts made between four and seven years before death
	Unused allowance of a spouse who died previously may be added to the Nil Band so that in some circumstances a total allowance of £600,000 may be allowed

Inheritance Tax Planning

Inheritance Tax is a very complex subject and the information given above is of necessity very limited. Although the recent Tax changes are of advantage to certain people, claiming the allowance for a spouse who has died several years ago is likely to be complex and it important to keep good records. We will be able to advise on this when drafting your Will. Its essential to ensure that your affairs are all in order otherwise you may be making a present of some Tax to the Taxman! Ask us for more information on Inheritance Tax Planning, and also post death arrangements whereby the will of a deceased person may in certain circumstances be re-written so as to mitigate Inheritance Tax liability.

Note: The Nil Band is set to rise to £325,000 over the next three years

Living Wills

A Living Will is a formal document signed by a person to express his or her wishes with regard to the kind of medical treatment which they wish to receive in the event that they are seriously ill and are incapable though such illness of giving their own directions concerning their medical treatment. Contact us for more information.

Enduring Powers of Attorney - as executed prior to 30th September 2007

An Enduring Power of Attorney is a document executed pursuant to the Enduring Powers of Attorney Act 1985. Following the enactment of this Act, it was possible to make an Enduring Power of Attorney which continued in full force and effect even though the Donor became mentally incapable, provided that the Donor of the Power was mentally capable at the time that the Power is signed. By signing the Power of Attorney, the Donor did not give up all rights to manage his affairs. He could continue to do this, and could revoke the Power of Attorney at any time before it has been registered. Attorneys should note that they must register a Power with the Court of Protection if they believe that the Donor is becoming or has become incapable of managing his affairs.

Enduring Powers of Attorney - Lasting Powers of Attorney - recent changes in the law

The law about powers of attorney has changed with effect from October 2007. It will not now be possible to create a new enduring power of attorney (EPA). EPAs have been replaced by lasting powers of attorney (LPA) although EPAs completed before October 2007 will remain effective. There will be two types of LPA, those dealing with finance and property, similar to the present EPAs, and those dealing with health and personal welfare issues. LPAs dealing with health and welfare are a definite improvement over EPAs, but LPAs dealing with finance and property come with a number of disadvantages compared with EPAs. For example:

	Increased bureaucracy when the LPA is completed.
	Much greater expense at the outset because of the requirement to register the LPA with the Office of the Public Guardian before it can be used. This could double or treble the cost.
	Likely delay at the outset as LPA must be registered before it can be used whereas EPA can be used immediately
	Removing one of the safeguards provided by EPAs whereby registration with the Court of Protection at the appropriate time shows that the donor is no longer able to deal with his or her finances and property. Registration can help to prevent financial abuse.
	No obligation to notify anyone when the donor is becoming or has become mentally incapable.

It is advisable for anyone who is becoming elderly or has a progressive disease to execute an LPA whilst they are still mentally able to do so. Once as person is deemed to be mentally incapable it is too late to execute the Power.

Disclaimer

Merriman Waine & Co is a firm of Solicitors practicing in Pewsey Wiltshire. This site contains general information based on the laws and procedures of England and Wales. Although every effort is made to check the accuracy of the information given, the contents of the site being of a general nature should not be construed as legal advice and visitors to the site should take appropriate legal advice. Merriman Waine & Co disclaim any liability in relation to the use of the site.